Opening Bell: 02.08.12

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China May ‘Move Shortly’ on Aid for Europe (Bloomberg)
China may “move shortly” to help Europe resolve its debt crisis by providing an investment of as much as 100 billion euros ($132 billion), said Yuan Gangming, an economist at the Chinese Academy of Social Sciences. The money would probably go to the European Financial Stability Facility, the euro bailout fund, said Yuan, adding that the forecasts are his own and don’t necessarily represent government plans. Economists from the academy provide policy advice without direct involvement in decisions. Helping Europe is like “hitting two birds with one stone,” Yuan said in an interview in Beijing Feb. 6. The action would have many benefits and few drawbacks, Yuan said.

Concession Smooths Way Toward a Greek Debt Deal (WSJ)
The European Central Bank has made key concessions over its holdings of Greek government bonds, which will contribute to a reduction of the country's debt burden and smooth the path toward a new bailout for the country, said people briefed on Greece's debt-restructuring negotiations. The decision by one of the Greek government's biggest creditors will narrow a gap in Greece's finances, helping pave the way for a debt-restructuring agreement with Greece's private-sector creditors and a new €130 billion ($170 billion) bailout from other euro-zone governments and the International Monetary Fund. But it is still unclear whether Greek politicians, facing public outrage, will accept the tough austerity policies pushed by European authorities and the IMF as the conditions to secure a deal.

Bernanke-Led Economy Shows Critics Clueless (Bloomberg)
More than a year after Republicans from House Speaker John Boehner of Ohio to presidential candidate Ron Paul of Texas warned that the Fed’s second round of asset purchases risked a sharp acceleration in prices, the surge has failed to materialize. The personal-consumption-expenditures price index rose 2.4 percent for the 12 months ending in December, near the central bank’s 2 percent target...Even though the economy is showing signs of strengthening and inflation appears in check, Republicans Mitt Romney and Newt Gingrich, who also are running for president, have said they wouldn’t keep Bernanke, 58, when his second four-year term as Fed chairman expires on Jan. 31, 2014. Gingrich said in September that Bernanke was “the most inflationary, dangerous and power-centered chairman” in the central bank’s history. “The criticism about the Fed being inflationary is not fact-based,” said Mark Gertler, an economics professor at New York University who has co-written research with Bernanke. “In terms of an inflation record, the facts are the Fed has been as close to impeccable as you can possibly get.”

Spain Plans to Burn Its Bridges to Keep Vacationers on the Job (WSJ)
Tatiana Restrepo has a vacation problem. The Spanish government thinks she takes too many of them. Every year, she, like many Spaniards, strategically deploys paid vacation days as puentes—literally, bridges—to skip town for an extra-long weekend whenever public holidays fall in the middle three days of a week. In that way, she figures that last year she was able to stretch her 36 legally mandated days off into more than 50 days of downtime, including weekends. But now the time-honored tradition is under threat. In one of several measures designed to boost productivity in a sagging economy, Spain's unions and business associations have agreed to suppress three bridges by moving the holidays to Mondays. The two sides, which rarely agree on anything, say the bridges cost the Spanish economy hundreds of millions of euros in lost production, as they result in idle plants and half-empty offices. "It's just horrible," says Ms. Restrepo, a marketer for Rusticae, a network of rural hotels, who every January studies the calendar with her husband to start planning jaunts around bridges.

Fink: Investors Should Be 100% in Equities (Bloomberg)
“I don’t have a view that the world is going to fall apart, so you need to take on more risk,” he said in an interview with Bloomberg Television in Hong Kong today. “You need to overcome all this noise. When you look at dividend returns on equities versus bond yields, to me it’s a pretty easy decision to be heavily in equities.”

Fed Will 'Protect the US' From Europe's Crisis: Bernanke (Reuters)
FYI: "We are in frequent contact with European authorities, and we will continue to monitor the situation closely and take every available step to protect the U.S. financial system and the economy,'' Bernanke told the Senate Budget Committee.

Hotel Workers Would Get Panic Alarm Buttons Under Proposed Contract (City Room)
Nine months after a hotel housekeeper accused Dominique Strauss-Kahn, the French politician, of sexually assaulting her in his suite in Manhattan, hotels across the city have agreed to equip their employees with panic buttons that will summon help immediately. That provision, scheduled to be put in place within a year, is included in a new seven-year labor contract that the Hotel Association of New York City approved last week.

Boston gets Butterfinger candy in honor of Patriots loss to Giants (NYP)
Colorado-based online pawn shop Pawngo.com left 900 pounds of Butterfinger candy bars in Boston's Copley Square on Tuesday to mock the New England Patriots. Patriots receiver Wes Welker dropped a pass late in the fourth quarter of Sunday's Super Bowl XLVI against the Giants, costing his team a shot at the title in a game they lost 21-17. The website left a large placard near the giant pile of 8,000 candy bars that read, "Thank you Wes Welker." Welker also was the likely target of Tom Brady's model wife, Gisele Bundchen, who said Sunday on her way out of the game, “My husband cannot f--king throw the ball and catch the ball at the same time! I can’t believe they dropped the ball so many times!”

Facebook's Zuckerberg may face $2 billion tax bill (Fortune)
Accountant nerds are super excited: "I personally have never seen a bill into the billions -- close, but not quite," said Anthony Nitti, a Colorado-based CPA and partner with Withum, Smith and Brown. "I talked to a few buddies of mine at the Big Four accounting firms, and it's something not many people have seen."

Hedge Funds Climbed 0.2% in January on Best Start for Equities in 18 Years (Bloomberg)
Hedge funds gained 0.2 percent in January as equities around the world had the best start in 18 years after U.S. economic growth showed signs of accelerating and European leaders moved closer to a solution for the region’s debt crisis...“We’re extremely pleased with how the portfolio’s been performing in 2012 to date,” said John Bailey, founder and chief executive officer of Spruce Private Investors LLC, whose Stamford, Connecticut-based firm advises investors holding about $3 billion of assets. “Investors will be looking for some measure of value added in hedge funds in 2012.”

Two Years After Spill, BP Profits and Plans (NYT)
On Tuesday, Robert W. Dudley, BP’s chief executive, told reporters in London that BP was “on the right path” as the company reported $7.7 billion in profit for the fourth quarter of 2011, a 38 percent increase from a year earlier. BP said production was up substantially from the previous quarter, and it expected its cash flow by 2014 to surge 50 percent past that of 2011, giving the company the financial strength to invest in exploration and pay even higher dividends.

Salvos Flying In Gupta Case (WSJ)
Federal prosecutors said they are planning to unveil previously undisclosed instances in which former Goldman Sachs Group Inc. director Rajat Gupta allegedly shared inside information when the criminal insider-trading case against him goes to trial later this year. Prosecutors announced their intentions at a court hearing in Manhattan federal court on Tuesday, as a judge granted defense lawyers' request to delay the trial so they could have more time to prepare. The trial, which had been set to start in April, will now start six weeks later on May 21, U.S. District Judge Jed S. Rakoff said.

Citi Bullish on Retail Banking (WSJ)
By 2014, "people will really see a difference" in improved customer service and product sales at Citibank branches, said the bank's U.S. retail and commercial banking chief, Cecilia Stewart, in recent interviews. "We'll beat all our competitors in productivity and client satisfaction," Ms. Stewart said, while revenue growth will make retail banking "much more profitable than precrisis."

Iowa Police Seek Public's Help In Armed Robbery Of $250 "Mega Masturbator" (The Smoking Gun)
In a bid to capture the armed robber who last month stole a $250 sex doll from an Iowa City adult store, police today released a surveillance photo showing the suspect making off with the item...Before releasing the store surveillance photo, cops pixelated it to obscure explicit images on the box of the “Fuck Me Silly #1” model "mega masturbator." As previously reported, the stolen 20-pound sex doll is described by its manufacturer as “the most realistic piece of ass you ever fucked...Slap that big round ass and listen to the whack...it sounds and feels just like a real ass!” In return for information leading to the man’s arrest, Iowa City Area CrimeStoppers is offering an award of up to $1000.

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Opening Bell: 6.29.16

Moody's downgrades 12 UK banks; Soros bets against Deutsche Bank; Saudi Arabia beating off bankers with a stick; Cops say woman wielded hatchet after her demands for sex were rebuffed; and more.

Opening Bell: 04.18.13

Morgan Stanley Sees Core Earnings Weaken (WSJ) Morgan Stanley saw core earnings weaken, although the investment bank swung to a first-quarter profit as it benefited from a comparison with a year-earlier period bogged down by a heavy charge. For the quarter, the bank reported a profit of $984 million, compared with a year-earlier loss of $94 million. The per-share profit, which reflects the payment of preferred dividends, was 49 cents compared with a loss of six cents a year earlier. The latest period featured a decline in fixed-income trading revenue, but strong stock trading and continued improvements in Morgan Stanley's wealth-management division, which was buoyed by strong markets. ... Revenue jumped 18% to $8.16 billion. Excluding debt valuation, revenue was $8.48 billion. Analysts polled by Thomson Reuters most recently expected earnings, excluding debt-valuation adjustments, of 57 cents, on revenue of $8.35 billion. Blackstone First-Quarter Profit Rises on Fund Performance (Bloomberg) Blackstone Group LP (BX), the world’s biggest buyout firm, said first-quarter profit rose 28 percent as market gains lifted the carrying value of its holdings. Economic net income, a measure of earnings excluding some costs tied to the firm’s 2007 initial public offering, increased to $628.3 million, or 55 cents a share, from $491.2 million, or 44 cents, a year earlier, New York-based Blackstone said today in a statement. Analysts had expected earnings of 53 cents a share, according to the average of 15 estimates in a Bloomberg survey. Barclays Head of Investment Banking Rich Ricci to Retire in June (Bloomberg) Barclays Plc’s Rich Ricci, the head of investment banking and one of the last members of former Chief Executive Officer Robert Diamond’s management team, will retire at the end of June. Ricci, 49, will be replaced by Eric Bommensath and Tom King, 52, as co-chief executive officers of corporate and investment banking in May, the London-based bank said in a statement today. “The market will see this as an inevitable and appropriate piece of transitioning,” said Ian Gordon, an analyst at Investec Plc (INVP) in London. “Few tears will be shed and the reshuffle will be broadly welcomed.” Special Report: The battle for the Swiss soul (Reuters) A sign on display in UBS's museum, from a bank founded in 1747 in the Italian-speaking part of Switzerland, could almost be Switzerland's mantra: "MASSIMA DISCREZIONE" it promises. Swiss bankers have long adhered to an unwritten code similar to that observed by doctors or priests. Bankers do not acknowledge clients in public for fear of exposing them as account holders; they often carry business cards with just a name, rather than bank or contact details; and, at least until the 1990s, they never advertised abroad. ... Even today, few Swiss like to discuss the fact that much of the country's prosperity was built on bankers helping foreigners evade taxes. Visitors should avoid personal questions, advises Communicaid, a consultancy which advises businesses on cross-cultural awareness. It would also be wise to steer clear of discussing "Swiss banks, money or Switzerland's military role in World War One or Two." Reinhart/Rogoff and Growth in a Time Before Debt (RortyBomb via Felix Salmon) Here is a simple question: does a high debt-to-GDP ratio better predict future growth rates, or past ones? If the former is true, it would be consistent with the argument that higher debt levels cause growth to fall. On the other hand, if higher debt "predicts" past growth, that is a signature of reverse causality. ... As is evident, current period debt-to-GDP is a pretty poor predictor of future GDP growth at debt-to-GDP ratios of 30 or greater—the range where one might expect to find a tipping point dynamic. But it does a great job predicting past growth. Ottawa sets up taxpayer-funded food truck in Mexico to promote Canadian cuisine (National Post) When author Anita Stewart first heard about the Canadian government’s new food truck parked in Mexico City, she laughed so hard she cried. The new Canada-branded, taxpayer-funded venture, which kicked off its three-week pilot project last week, is serving up a Mexican-ized version of poutine, using Oaxaca cheese instead of curds. Also on the menu are Alberta beef tourtière, and maple-glazed Albacore tuna. China Vows Wider Yuan Movement (WSJ) China's central bank plans to widen the yuan's trading band in the near future, People's Bank of China Vice Governor Yi Gang said Wednesday, suggesting that China's leaders will press ahead with change despite the surprise slowing of the economy. "The exchange rate is going to be more market-oriented," Mr. Yi said on a panel at the International Monetary Fund spring meetings in Washington. "I think in the near future we are going to increase the floating band even further." IMF warns on risks of excessive easing (FT) Extraordinarily loose monetary policy risks sparking credit bubbles that threaten to tip the world back into financial crisis, the International Monetary Fund warned on Wednesday. In its global financial stability report, the fund cautioned that policy reforms were needed urgently to restore long-term health to the financial system before the long-term dangers of monetary stimulus materialised. German Parliament Approves Bailout for Cyprus (WSJ) German Finance Minister Wolfgang Schäuble called the vote a "strong signal" by Germany in favor of the euro and the euro zone. The parliament also voted in favor of a seven-year extension of the maturity on European Financial Stability Facility loans for Ireland and Portugal with a large majority. SEC to Move Past Financial Crisis Cases Under New Chairman White (Bloomberg) Mary Jo White, the first former prosecutor to serve as chairman of the U.S. Securities and Exchange Commission, has pledged to run a “bold and unrelenting” enforcement program at the agency charged with regulating Wall Street. With financial crisis cases mostly done and some of the biggest insider-trading cases in history closed, White will have to chart a course into new areas to keep that pledge. White, who was sworn in last week, has already provided a few signals about what that might be. During her Senate confirmation hearing, she said she intends to focus on high- frequency and automated trading. She has also raised questions about a drop in the number of accounting fraud cases the agency has brought in recent years. Dispute in Hamptons Set Off by Effort to Hold Back Ocean (NYT) Soon after Hurricane Sandy hit last fall, Joshua Harris, a billionaire hedge fund founder and an owner of the Philadelphia 76ers, began to fear that his $25 million home on the water in Southampton might fall victim to the next major storm. So he installed a costly defense against incoming waves: a shield of large metal plates on the beach, camouflaged by sand. His neighbor, Mark Rachesky, another billionaire hedge fund founder, put up similar fortifications between his home and the surf. Chris Shumway, who closed his $8 billion hedge fund two years ago, trucked in boulders the size of Volkswagens. Across a section of this wealthy town, some residents, accustomed to having their way in the business world, are now trying to hold back the ocean. ‘Elvis’ is busted in ricin terror (NYP) The FBI last night busted a troubled Mississippi Elvis impersonator as the poison-wielding man who mailed ricin-laced letters to President Obama and two other officials. ... Despite his rock ’n’ roll hobby, Curtis shows his angry side on Facebook, where he lashes out in a conspiracy-filled rant. “I’m on the hidden front lines of a secret war,” he wrote. “They burned down my home, killed my dogs, my cat, my rabbit, blew up my 1966 Plymouth Valiant . . . and guess what? I am still a thorn in their corrupt anals! I will remain here until Jesus Christ decides it’s time for me to go.”